No sign of election slowdown

The latest edition of our UK Investment Transactions report reveals that investor appetite has been undeterred by the upcoming General Election. On the heels of a record year in 2014, Q1 volume reached £19.1bn, the second highest quarterly total on record after Q4 2014.

The report, which covers the first three months of 2015, also finds that:

The All Property transaction yield dropped below 6% for the first time in seven years, moving down by 19 basis points in Q1. Of the core sectors, Industrial saw the strongest inward movement, coming in by 23 basis points to 6.49%

Specialist sectors accounted for a record 20% share of volume. Q1’s four largest deals comprised three student accommodation portfolios and the Jurys Inn hotel portfolio, all of which were purchased by overseas investors

Q1 investment in the three core sectors was down on the final quarter of 2014. Rest of UK Offices and Office Parks were the only two core subsectors to see an uplift in activity

Activity in the regions continued to increase in Q1, rising marginally on Q4 2014 and 30% above the same period last year. While volume in London was 30% above the rest of the UK combined, investment in the capital was down 19% on Q4 2014

Overseas investors accounted for 50% of Q1 volume, despite transacting only 17% of deals. Central London assets and portfolios remain the focus, although overseas activity in the regions increased by 41% quarter-on-quarter

Overseas investors were the largest net buyers inQ1, followed by the UK institutions. Private property companies and private investors were net sellers.